I tried this. Thing is, just reading about design does nothing for me. I can read about typography all day, but I still feel like a novice when I have to decide what font "looks good" (besides the obvious ones, that is).

I simple don't feel the urge to go open Photoshop/Gimp and toy with new designs - I won't know where to begin, and yet, I want to become better at design. :-/

I wish there were more practical, interactive lessons somewhere where I could see the reward for learning some new design-related skill.

I can second this. Ive been going over the hackdesign material for the past few months and Ive found it really useful